HOLLYWOOD, Fla., May 29, 2007 (PRIME NEWSWIRE) -- TOUSA, Inc. (NYSE:TOA) announced today that it received an extension on its written financing commitment letter from Citigroup Global Markets Inc., together with certain of its affiliates ("Citi"). As previously announced, Citi has agreed to provide financing to establish (i) a new $250.0 million aggregate principal amount first lien term loan facility (the "First Lien Term Loan Facility") and (ii) a new $250.0 million aggregate principal amount second lien term loan facility (together with the First Term Loan Facility, the "Facilities"). The Company does not expect to provide further updates on the expiration time of the commitment letter unless it is signed by the Company or it expires.
In addition, as a condition to the commitments, the Company's existing $800.0 million revolving loan facility (the "Revolving Loan Facility") shall be amended and restated to (i) reduce the revolving commitments thereunder by $100.0 million and (ii) incorporate the terms and conditions of the First Lien Term Loan Facility, and as a result the commitments are subject to the approval of the lenders in the Revolving Loan Facility.
The proceeds from the Facilities are expected to be used to fund any settlements related to the Transeastern JV. There is no assurance that the Company will be able to reach satisfactory settlements with the Transeastern JV's creditors or land bankers. The Company does not anticipate that it will execute the commitment letter unless it has entered into satisfactory settlements with the creditors to the Transeastern JV including, but not limited to, settlements with the senior lenders, the mezzanine lenders and land bankers to the Transeastern JV. If the commitment letter is executed by TOUSA, the parties have until July 31, 2007 to execute definitive documentation of the financing before the commitments in the commitment letter terminate.
On May 17, 2007, the Company filed a Current Report on Form 8-K with the Securities and Exchange Commission which provides further details on the proposed financing. For a description of the Company's dispute with the Transeastern JV lenders please see the Company's Annual Report on Form 10-K for the year ended December 31, 2006 and Quarterly Report for the quarterly period ended March 31, 2007 on Form 10-Q (the "10-Q"), each filed with the Securities and Exchange Commission and available at www.sec.gov, including the information appearing in the 10-Q under Part I, Item 2 -- "Management's Discussion and Analysis of Financial Condition and Results of Operations -- Transeastern JV" and Part II, Item 1 -- "Legal Proceedings."
TOUSA, Inc. is a leading homebuilder in the United States, operating in various metropolitan markets in 10 states located in four major geographic regions: Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs, builds, and markets high-quality detached single-family residences, town homes, and condominiums to a diverse group of homebuyers, such as "first-time" homebuyers, "move-up" homebuyers, homebuyers who are relocating to a new city or state, buyers of second or vacation homes, active-adult homebuyers, and homebuyers with grown children who want a smaller home ("empty-nesters"). It also provides financial services to its homebuyers and to others through its subsidiaries, Preferred Home Mortgage Company and Universal Land Title, Inc. For more information on TOUSA, please visit our website at www.tousa.com.
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This press release contains forward-looking statements including statements concerning the status of the Company's settlement discussions and risks associated with those discussions. Certain important factors may have affected and could in the future affect our actual results or our liability for the indebtedness of the Transeastern JV and could cause the Company's actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company. The factors are outlined under the "Risk Factors" sections of the Company's Securities and Exchange Commission filings, including the Company's annual report on Form 10-K for the year ended December 31, 2006, filed with the Commission on March 20, 2007 and the Company's quarterly reports on Form 10-Q date filed with the Commission after such date. We do not undertake any duty to update any forward-looking statement.